How Do I Know If I Should Make a Price Adjustment on My House?

By
Real Estate Agent with Realty Executives Integrity R.E. Broker 55289-90

I recently wrote a brief post about the increase in sales in Ozaukee and Washington counties from February to March of this year. While this is encouraging news, by no means are we "out of the woods" yet. Short sales and foreclosures are still numerous, and inventory is still high. So if you currently have your house on the market or are considering selling, it is especially important in these times that you pay attention to what is happening in your specific market.

teamworkIf you truly want to sell your home, stay positioned ahead of your competition. How do you do that? Work with your real estate agent.

I try to provide my sellers with regular updates on the activity we have (or have not) had on their house. This includes requests for private showings, phone inquiries, and open house visitors. They all have continuous access to an activity report that provides a summary of this information.

Pay attention to the feedback that's given at private showings and open houses. What do potential buyers like about the house? What don't they like? Are the dislikes things you can change or improve (for minimal cost)? Try as best you can to compare your house to your competition objectively and recognize what your house has that theirs doesn't and vice versa. Take note of how long your house has been on the market compared to other homes that are on the market and that recently sold.

If there have been several private showings, traffic through every open house, and high internet traffic but no offer, pay attention to that. If much of the feedback about the house has been positive, but still no offer, pay attention to that. On the flipside, if the overall activity has been sparse, pay attention to that. Recognize that the market can likely not handle the current list price.

Anxiety

One of the most difficult parts of my job is making "that" phone call. You know the one -- when we have to discuss a new strategy, a price adjustment. Providing an up-to-date market analysis is the best way to see on paper where your house is positioned in comparison to your competition. And it shows you what homes comparable to yours have recently sold for.

While there was a time when we could rely on properties that sold as long as a year ago, that is no longer the case. Prices have unfortunately declined at a pace that now makes it necessary to focus on solds from the past few months.

When you can see on paper how prices have declined, it can be a very tough pill to swallow. But if you are committed to selling your house, acknowledging that a price adjustment is probably needed is a necessary part of the home-selling process.

Your real estate agent is there to help you sift through all the information -- to help analyze all the data. Work together to sell your home, not your competition's.

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Re-Blogged 1 time:

Re-Blogged By Re-Blogged At
  1. Pat Tasker 04/10/2009 04:27 PM
Topic:
Home Selling
Location:
Wisconsin Ozaukee County Grafton
Groups:
Milwaukee
Realtors®
Wisconsin Active Rainers
Tags:
seller tips comparative market analysis ozaukee county real estate washington county real estate

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Rainer
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Carolyn Hawkins
Allison James Estates & Homes, Inc. - Port Charlotte, FL

Despite the media regarding the current housing situation many owners do not want to face the reality and list their home accordingly.  If there hasn't been a call within six weeks of the listing a price adjustment needs to be done.  As a realtor the only thing you can do is to continue to put the stats in front of the buyer.  I've been running into this situation with all of my listings.  

Carolyn Hawkins, Realtor Associate - Allison James Estates & Homes, Inc. -Lake Suzy, Fl.  - www.southwflorida.com

Apr 06, 2009 01:03 PM #1
Rainer
11,433
Sarah Sonke
AuctionFirst.com and TrianglePremierAuctions.com - Raleigh, NC
Auctioneer/Broker

Sellers are behind the curve in reducing their prices.  Once they decide to go ahead and do it, they're still behind the curve because they should have done it weeks ago. 

I think the very best policy in this kind of market is to discuss this up front when taking the listing.  Set out a strategy at the get go that they agree to. Purpose is to sell their home for the most money possible.  But you don't want the marketing to get stale.  It's all about absorption rates and the price has to be right in order to sell their home in x number of days.  For instance, if only 3 homes sold in their area within the last 6 months, and there are now 6 homes for sale, your clients need to be priced below the absorption rate in order to sell quickly (less than 6 months).

I know that conversation is really hard.  Because I auction real estate, I get the conversation right at the beginning of the auction list: "what is the lowest price you would accept in order to sell your home in 4 weeks?"

Good luck!

Apr 06, 2009 01:17 PM #2
Rainmaker
208,110
Peggy Wester
Realty Executives Integrity - Grafton, WI
Real Estate Agent Ozaukee & Washington County

Carolyn -- I agree! I presented three of my sellers with an updated market analysis, and only one "saw the light." He could not believe, when he saw the numbers on paper, how prices have dropped and finally agreed a price adjustment was necessary if we were going to sell the house.

Sarah -- I have and continue to discuss the pricing strategy up front. Unfortunately I've found that in some cases the seller changes their way of thinking along the way. I think it is best to put the numbers/stats on paper so they can see for themselves that we're not pulling them out of the air. Some get it. But some just don't... Thank you for stopping by!

Apr 07, 2009 01:47 AM #3
Ambassador
1,893,598
Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

Peggy, no offers with great showings points to price too high. Very good on your part to remind the Sellers that. It can be scary when prices drop. Some take their homes back off the market.

Apr 11, 2009 11:16 AM #4
Rainmaker
208,110
Peggy Wester
Realty Executives Integrity - Grafton, WI
Real Estate Agent Ozaukee & Washington County

It certainly has been scary to see how prices have dropped in our area over the past six months and unfortunately continue to do so. Bottom line for the seller, in my opinion, though, is do you want to sell your house or not? And if they don't care, then it's probably time to part ways. Thank you for stopping by!!

Apr 11, 2009 11:21 AM #5
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Rainmaker
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Peggy Wester

Real Estate Agent Ozaukee & Washington County
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